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The 9 Sustainability Innovations of Nespresso

The following nine innovations demonstrate Nespresso’s commitment to creating positive change for the farmer communities which supply its high quality coffee, the environment in which it operates and the people it interacts with - from farmer to consumer. They also help to underpin the company’s growth strategy as it considers how and where it can create the most sustainable value and build for long-term success in the face of tough global challenges, such as climate change.

1. A unique sourcing model that embeds sustainability

Co-created with the leading NGO the Rainforest Alliance, Nespresso has developed a unique sourcing model with a dual focus on quality and sustainability, which bypasses the use of traditional commodity markets and has instead built direct relationships with more than 63,000 farmers in 11 countries.

The Nespresso AAA Sustainable Quality™ Program supports farmers to improve coffee quality, yields, incomes and sustainability through sound farming practices. Enabling traceability back to individual farms, Nespresso also gets a consistent, regular and sustainable supply of coffee from more climate resilient farms. In fact, a recent independent study found that farms taking part in the AAA Program had 22.6% better social conditions, 52% better environmental conditions and 41% better economic conditions than non-AAA farms.

Imagine starting to revive coffee production in a country that still suffers the ravages of more than 30 years of civil war. Well, that’s what Nespresso is doing in South Sudan.

The company is working with its on-the-ground partner TechnoServe to revive high-quality coffee production in the country - and it is already seeing the fruits of its endeavours, exporting the first coffee from the region into Europe and setting a course for coffee to be the second largest export after oil.

Navigating unique infrastructure challenges, Nespresso is giving hundreds of farmers in the country new economic opportunities and building a new sustainable supply of coffee to satisfy Club Members eager to taste new coffee profiles. The first coffee from the country, Suluja ti South Sudan, was proposed as a very limited edition to consumers in France.

For a company that relies on sourcing amongst the 1-2% of the world’s coffee that meet its strict taste and aroma criteria, it is crucial that Nespresso helps coffee farmers be more productive and climate resilient. So, it is planting trees - lots of them - to prevent soil erosion, protect and restore natural ecosystems, regulate water availability, enhance soil fertility and absorb carbon from the air to generate biomass, among many other things.

By 2020, it aims to plant millions of trees in the coffee regions it so relies upon. And there is good reason for it to do so. The newly-planted trees offer much-needed shade, regenerate soils and create more healthy and productive coffee-growing land. This results in more money for the farmers, more quality coffee for Nespresso and farms better prepared to resist to climate change.

Colombia’s coffee farmers have traditionally spent many hours carrying out their own milling and drying process - turning their freshly-picked coffee cherries into coffee beans. It is an often inefficient approach that invariably ends up with coffee beans being damaged. In fact, on average, around half of any one farmer’s resultant crop is damaged between harvesting and readying the coffee beans for sale, and therefore not suitable for Nespresso’s needs.

Nespresso, together with partners Expocafé, Andes Coffee Cooperative, USAID, the non-profit development agency ACDI/VOCA and Cenicafé, the Colombian coffee research centre, has found a better way. A centralised coffee-processing centre - a central mill - is taking the milling and drying out of the hands of individual farmers in the region of Jardín and is instead performed by staff employed at the mill. With more than 170 different farmers now using the mill, Nespresso has been able to source a consistent supply of coffee and doubled the production volume of coffee matching both its quality and sustainability profiles.

And for the farmers, more volume of quality coffee - with the quality rejection rate falling to 0% - means more money and average net incomes rising by 17%.

In Colombia, the average age of coffee farmers is 53 and their children are increasingly turning their back on the industry in favour of jobs in the city.

To safeguard their future and encourage young people to stay and produce coffee like their fathers before them, Nespresso set up a pilot retirement savings plan in the Caldas region. Working in partnership with the Colombian Ministry of Labour, Fairtrade International, local coffee cooperatives and coffee supplier Expocafé, the Farmer Future Program was established in 2014. More than 850 farmers have signed up and the first payments have been made into dedicated savings accounts, with Nespresso committing 300,000 pesos (CHF106) to each farmer and the Colombian Government matching 20% of what each farmer contributes themselves in the future.

As Nespresso CEO Jean-Marc Duvoisin acknowledges, “in order to implement shared value, we need partners on the ground to work closely with farmer communities to integrate our approach.” Working with a multitude of different partners - from NGOs, to government agencies and farmer cooperatives - the company has mastered the art of combining its own expertise and skill-sets with those of on-the-ground organisations, while while providing them the freedom to create positive impact.

It is an innovative approach to collaboration that goes beyond labels and certification. Just look at all the above examples.

As the old adage goes, ‘you can’t manage what you haven’t measured’. It is only by getting a handle on the impact of their sustainability programs that organisations can effectively track progress and pinpoint where to focus efforts and resources to have the greatest impact.

Developed in 2008, Nespresso uses a comprehensive AAA Sustainable Quality™ Farm Advanced Relationship Management System (F.A.R.M.S.) to gather and analyse data about farms’ quality and sustainability progress in real time in producing countries. It’s an essential asset for Nespresso, helping it to tailor the environmental management support it gives to farming communities and to have a global overview of its AAA Program implementation and the adoption of sustainability best practices.

8. An advisory board that shapes innovative sustainability solutions for the future

Launched to coincide with the tenth anniversary of the AAA Program, the Nespresso Sustainability Advisory Board (NSAB) is something of a rarity in sustainable business circles: an independent panel of experts that exists to bring expertise and field experience, challenge the company’s existing strategy and push the boundaries of what might be possible by exploring new models and ways of collaborating.

Consisting of experts from the likes of the International Union for Conservation of Nature, the University of Cambridge Institute for Sustainability Leadership and the Rainforest Alliance, the board helps Nespresso innovate beyond traditional and generic approaches to sustainability, ensure continuous improvement and find new solutions for the future.

Bringing together a multi-expertise group from different NGOs, partners and from across Nespresso, it really is stakeholder engagement at its best.

Since 2009, Nespresso has been working to increase the recycling capabilities for small-scale aluminium and steel packaging such as its own capsules, pet food containers and bottle tops - the types of packaging that cannot always be processed in recycling centres in Europe. In France, it co-founded the Club for Aluminium and Steel Light Packaging (CELAA), to help create the infrastructure that would improve the situation.

With CELAA, the company has developed an electromagnetic system that makes use of existing eddy current technology in a totally new way to separate small-scale aluminium and steel packaging from other waste - allowing Nespresso capsules as well as other small packaging to be recycled.